By the Business Facilities Editorial Staff
From the January/February 2019 Issue
With more than 40 projects to choose from in our 2018 Deal of the Year competition, our judges had to put in overtime to designate 10 worthy recipients of our Honorable Mention Awards.
After we tabulated the total number of submissions for our 2018 Deal of the Year Awards—an all-time-record of 43 projects from nearly 20 states and provinces across the U.S. and Canada—we knew we had better reserve some extra pages for the Honorable Mentions section of our DOTY awards feature. With our top Deal of the Year Awards bestowed predictably on three of the most coveted projects (Amazon’s selections of not one, but two locations for its HQ2, and Alabama’s victory in snatching the Mazda-Toyota car plant), perhaps the fiercest competition took place for our Honorable Mention Awards.
The judges chose 10 worthy projects for this category:
Tennessee Department of Economic and Community Development for Amazon’s Operations Center of Excellence in downtown Nashville.
Amazon’s selection of Nashville for its new Ops Center will create 5,000 new jobs in Davidson County, the single-largest jobs commitment made by a company in Tennessee’s history, according to state officials. The $230-million project also will have a direct economic impact of nearly $8.9 billion in Tennessee over the next 10 years, directly creating more than $6.5 billion in direct wages in the coming decade.
“This is a game changer for Tennessee. The ripple effect of Amazon’s decision to invest $230 million in our state and create 5,000 high-paying jobs in downtown Nashville will be felt for years to come,” then-Gov. Bill Haslam said at the project announcement. “Amazon has spent the past year searching the nation for the best possible locations to expand and it chose Tennessee because of our business-friendly policies, low taxes and skilled workforce. I thank Amazon for its continued investment in Tennessee.”
Amazon has five fulfillment and sortation centers in Tennessee located in Charleston, Chattanooga, Lebanon, Murfreesboro and Nashville, as well as one Prime Now Hub in Nashville. From 2011 to 2017, Amazon has invested more than $5 billion in Tennessee, including customer fulfillment infrastructure and compensation to its employees.
Amazon will build its Operations Center of Excellence in Nashville Yards, a 15-acre, mixed-use development in downtown Nashville. The one million square foot office space will house the tech and management functions of Amazon’s Retail Operations division, including customer fulfillment, customer service, transportation and supply chain, amongst others.
Along with the City of Nashville, the State of Tennessee also worked with key partners, including the Tennessee Valley Authority (TVA) and Nashville Area Chamber of Commerce, to recruit the project to the state.
“We are honored to be part of this endeavor, one of the largest initial new jobs commitments in the history of TVA Economic Development, and we look forward to working closely in partnership with Nashville Electric Service and Amazon for years to come,” TVA President and CEO Bill Johnson said.
Consumers Energy for the Spartan Michigan Dairy Processing Facility
Glanbia, Dairy Farmers of America (DFA) and Select Milk Producers have partnered to form Spartan Michigan, LLC and develop a new $425 million, 146-acre dairy processing facility. The project is expected to create 259 new jobs and process more than 8 million pounds of milk per day to manufacture cheese and whey permeate powder.
This project, which will create a dairy processing campus for one of the largest value added agriculture projects in Michigan’s history, will be located on 153 acres of land in St. Johns, MI. The campus will support multiple dairy processing investments and may rival the largest facility of its kind in North America in size—Southwest Cheese of Clovis, NM. That facility is owned by a joint venture of Glanbia, DFA and Select Milk Producers.
Also, Proliant Dairy Michigan is investing $85 million in an adjoining facility to manage the whey permeate powder produced as a byproduct of Spartan Michigan, LLC. The facility will employ up to 38 new workers and process approximately 400,000 pounds of permeate solids per day to make dairy ingredients for human and animal food. Once operational, the Proliant site will be the largest permeate facility in the world.
“(This) project represents the most significant non-automotive related business attraction effort to our region in 25 years,” said Bob Trezise, President/CEO of the Lansing Economic Area Partnership, in an interview with Michigan Farmer.
The new facilities will provide a dedicated outlet for milk that currently must travel long distances and compete with inflated supply in the upper Midwest. In fact, making Proliant a neighboring facility on the same campus virtually eliminates additional transportation costs for manufacturing the whey permeate byproduct.
Opportunities New Brunswick (ONB) for the Nearshore Shared Services Center in Moncton, New Brunswick, Canada
ONB, the province of New Brunswick’s lead business development corporation, began discussions with TD Bank Group in 2017. By June 2018, the two organizations had completed three announcements that will create 1,290 full-time jobs in New Brunswick. These new positions would be created across both TD’s banking and insurance lines of business.
Headquartered in Toronto, TD services more than 25 million customers worldwide, and employs over 85,000 people in offices across the globe. They have been named the Best Bank in Canada by Euromoney Magazine and, for the 12th year in a row, named one of the Best Workplaces in Canada in 2018 by the Great Place to Work Institute.
In April 2018, it was announced that TD will establish a new nearshore shared services center in Greater Moncton, New Brunswick, creating up to 440 new high-skill financial services jobs over seven years with support from ONB. Combined with the mid-2017 announcement to create up to 575 customer service-focused jobs, TD now stands to create 1,015 new jobs in Greater Moncton.
Building on this announcement, TD Bank Group’s insurance arm, TD Insurance, announced it would further expand the company’s New Brunswick footprint by creating up to 275 new jobs over seven years at its existing business services center in nearby Saint John.
The combined direct economic impact of these TD announcements is $776 million over 10 years. The shared services center in Greater Moncton and additions to the Saint John center will contribute 11,115 (cumulative) direct jobs; 1,486 indirect jobs; and 1,538 induced jobs to the region over the same 10-year period. This will generate $401 million in direct wages, $47 million in indirect wages and $54 million in induced wages over those 10 years.
Combined, the centers will reach a maximum of 1,290 new positions. TD also is investing approximately $50 million on renovations for the new Greater Moncton center. With Cadillac Fairview (CF), a large property management company with real estate holdings in both the U.S. and Canada, investing its own $25 million into that project, the new center will transform a former Sears Canada retail space into a visually appealing and modern office workspace.
The shared services operation will be in TD’s new corporate office, sharing space with the business services center in the former Sears retail location at CF’s Dieppe-based CF Champlain Place Shopping Center—Atlantic Canada’s largest single-building shopping center.
In a press release, CF noted, “This redevelopment is not only beneficial to CF and TD but more importantly to Greater Moncton/Dieppe. The addition of the TD Finance Operations and Business Services Centers will continue to solidify CF Champlain’s position as New Brunswick’s premier shopping center and a vibrant, mixed-use destination.”
Recruitment for both the finance operations and customer service jobs has already begun and the office is expected to officially in January 2019.
Rhode Island Commerce Corp. for Amgen’s Next-Generation Biomanufacturing Facility
RI Gov. Gina Raimondo and her team have gone above and beyond to support manufacturing on several fronts, including the January 2017 launch of the Rhode Island Manufacturing Initiative—a program that includes economic development incentives to encourage manufacturers to purchase new equipment, launch new product lines and hire new workers. In April 2018—just a little over a year later—Amgen announced that it would expand in the state with a new $160-million next-generation biomanufacturing plant that will be the first of its kind in the United States, modeled after a facility the company constructed in Singapore four years ago.
Amgen—a life-sciences powerhouse ranked in the top 10 most valuable public life science companies in the country—has been in Rhode Island since 2002.
For this deal, the state was on overdrive—both in speed and efforts. West Greenwich, a town so small that the administrator is part-time, really stepped up with its tax stabilization incentive. An initial meeting with Amgen and its site selector included 25 to 30 stakeholders from throughout the state. The Rhode Island Commerce Corp. (RICC) sent five people, including Secretary of Commerce Stefan Pryor. Other organizations represented included the town of West Greenwich, Rhode Island’s DLT, the National Grid, the Kent County Water Authority, Department of Revenue, the Division of Public Utilities and Carriers, and more.
Amgen’s Rhode Island site currently comprises one of the world’s largest mammalian protein manufacturing facilities; it manufactures commercial and clinical bulk drug substances. The new facility, which will ultimately create approximately 150 new highly skilled manufacturing jobs, will be supported by Rhode Island’s innovative toolkit of economic development programs.
Out of all the potential locations across the U.S., Rhode Island was selected based on the historical success of the Amgen West Greenwich manufacturing facility, its capabilities and talented workforce, the quality of living for staff and its potential to grow. If Amgen had gone elsewhere, the company would have had to start from ground zero—but in Rhode Island it could borrow talent from its other facility, and from a talent and space perspective there was much already in place. Additionally, a key component that made Rhode Island a prime choice over other locations for Amgen was the state’s shipping/transportation infrastructure—a significant need for the new facility.
The initial package sent to the Amgen site selector included The Real Jobs Rhode Island training grant; this standout example is a demand-driven state-funded program. Amgen is applying to bring its own trainer over from Singapore to work with the close to 150 workers who will need to learn how to work in the brand-new modular environment that the new plant will represent. As a benefit, Rhode Island is becoming a mini-hub of next-gen biomanufacturing talent.
Amgen expects to invest up to $200 million in the approximately 120,000-square-foot manufacturing plant. After excluding costs that do not have a direct impact on Rhode Island’s economy (such as manufacturing process equipment, assumed to be procured out-of-state, technology transfer fees and interest paid during construction), Appleseed—retained by RICC to conduct an external economic impact analysis of projects involving state investment—estimates that the company will spend $122.8 million in Rhode Island on construction of the plant. Appleseed estimates that these direct expenditures of approximately $122.8 million will directly and indirectly generate 944 person-years of work in Rhode Island, with $62.3 million in earnings (in 2019 dollars); Approximately $150.1 million in statewide economic output; and a one-time increase of $87 million in Rhode Island’s GDP.
The Henrico Economic Development Authority for Facebook’s Henrico County Data Center Expansion
This project is anticipated to have an estimated economic impact of $500 million over the next five years.
In October 2016, the Henrico Economic Development Authority (HEDA) engaged a large data center project (codenamed Project Echo) through Dominion Energy’s Economic Development team. Due to its significant water, sewer, electric and fiber infrastructure, HEDA and Dominion Energy identified White Oak Technology Park (WOTP)—Henrico’s EDA owned, master-planned industrial park—as a potential site for Project Echo.
In December 2016, Dominion Energy and the Virginia Economic Development Partnership introduced the Echo team to HEDA and Henrico County officials to discuss the project and tour White Oak Technology Park.
After 10 months of negotiations, in October 2017, Facebook announced and began the construction of the Henrico Data Center in White Oak Technology Park. Phase I of the project included two buildings and 970,000 square feet of space, at a capital investment of $750 million. Phase I created 100 jobs at an average annual salary of $77,828; its buildings will be in operation by mid-2019.
Phase II of the Facebook project, announced on September 26, 2018, includes three buildings with a total of 1.5 million square feet, with another capital investment of $750 million and another 100 high-wage jobs. Construction on Phase II began at the end of last year.
Dominion Energy’s agreement with Facebook to power the data center with renewable energy will drive significant investment in renewable energy facilities across Virginia. According to a Chmura Economics and Analytics study of the proposed US-3 Solar Projects (those associated with Facebook’s agreement), the investment will provide direct and indirect benefits of approximately $217.2 million and support 1,477 jobs on a cumulative basis from 2018 to 2021.
Facebook’s Henrico Data Center will ultimately be one of Henrico County’s largest taxpayers. In addition to real estate taxes collected, Facebook’s expected upgrades and reinvestment in its data center technology will provide significant annual tax revenues for years to come.
The Economic Development Council of St. Lucie County (FL) for Maverick Boat Group’s New Manufacturing Facility
Maverick Boat Group was founded in 1985 by brothers Scott and Troy Deal. The brothers, devoted light tackle fisherman, decided to turn their fishing passion into a full-time commitment to building the best shallow water skiff. Today, the Maverick Boat Group produces four brands of boats—Maverick, Hewes, Pathfinder and Cobia—and is the country’s premier boat builder in the shallow water skiff market segment.
The company is headquartered in Fort Pierce, St. Lucie County, FL. For the past 30 years, Maverick Boat Group had been housed in over 85,000 square feet of space in three separate buildings located on an 8.51 acre campus. Since the calendar year starting 2009 through the close of 2015, the company’s production increased 306 percent with an increase in new boat sales revenue of 639 percent.
As the company’s production grew, the production process became less efficient and required an abundance of movement of raw materials, people and finished parts between buildings. Due to the significant growth, the company’s existing site could no longer meet production demands.
As manufacturing is a targeted industry in St. Lucie County, Maverick was eligible to receive expedited permitting for the development of a new state-of-the-art manufacturing facility. The ability to receive expedited permitting was an important site location decision factor in the company’s ability to meet production demands prior to the new boat model season.
Maverick identified a 36-acre site, located approximately one mile from the company’s headquarters. The company’s expansion included the construction of a 110,400-square-foot production facility with a capital investment of approximately $7 million in construction, machinery and equipment, as well as new job creation of 100 at an average wage of $35,000 plus benefits.
Recognizing Maverick Boat Group’s long history in St. Lucie County, the company’s commitment to the community and status as a major employer, the Economic Development Council of St. Lucie County assisted Maverick with an attractive incentive package for its expansion, retention of 273 jobs and addition of 100 new jobs. Together, the St. Lucie EDC, State of Florida, Department of Economic Opportunity and St. Lucie County provided a package that included a 10-year/100 percent Ad Valorem Tax Exemption for real property and tangible personal property; $500,000 Qualified Targeted Industry Tax Refund; St. Lucie County Job Growth Investment Grant in the amount of $210,000; St. Lucie County Road Impact Fee Mitigation; and expedited permitting.
The County’s expedited permitting process provided the company with site plan and building permit approval within just eight weeks.
On January 19th, 2018, Maverick Boat Group held a groundbreaking ceremony at their new site. With local collaboration that included St. Lucie County, Fort Pierce Utilities Authority and Florida Power and Light, the company opened its doors a little over six months later, on July 23, 2018. Among the company’s first guests at its new facility—over 100 boat dealers from around the country for the Maverick Boat Group annual dealers conference.
The City of Baytown (TX) and Chambers County for the JSW Steel Strategic Modernization and Expansion Project
The strategic modernization and expansion of India-based JSW Steel’s mill in Baytown is not only important to the region east of Houston, but also to the State of Texas and the nation as a whole. There is little doubt that without the proposed up-grades, the plant could not continue to operate profitably, and 400 existing jobs would have been lost.
The critical nature of this project drew the personal involvement of TX Gov. Greg Abbott. In addition to awarding the project a Texas Enterprise Fund grant, the governor visited the headquarters of JSW Steel in India and met with their chairman and CEO, stressing the importance of the project to Texas and his desire to assist however needed.
The modernization and expansion represents a vital step in bringing America’s steel making technology up to date and is capable of competing in the world market place. The project includes the construction of a new state-of-the-art melt shop with an electric arc furnace that uses scrap metal as the feed stock, accompanied by the latest technology in pollution controls and slab casters.
This will be the first melt shop built in the U.S. in decades and the only one outfitted with up to date technology and controls. The new melt shop will give the company the ability to manufacture and sell steel plate of varying specifications and sizes. In the past, all plate produced by the mill was used in manufacturing large diameter pipe. The new plate rolling mill will include hot and cold levelers, as well as all required ancillary processes and procedures.
A groundbreaking ceremony was held on October 19, 2018, with operations projected to begin in July 2021. The investment of approximately $25 million by local governments and the State of Texas will deliver an estimated direct economic output over a ten year period of $2.5 billion (with $3.5 billion combined indirect and induced impacts).
The Gilbert (AZ) Office of Economic Development (GOED) for Deloitte’s U.S. Delivery Center
Through the hard work of the Gilbert, AZ Office of Economic Development (GOED), the Greater Phoenix Economic Council (GPEC) and the Arizona Commerce Authority (ACA), Deloitte Consulting LLP (Deloitte) announced Gilbert, AZ as the location of its new U.S. Delivery Center for client technology solutions.
Deloitte provides industry-leading consulting services to many of the world’s most admired brands. With over 240,000 worldwide associates, Deloitte is ranked among the nation’s leading professional services firms in audit and assurance, risk and financial advisory, tax and consulting services across more than 20 industries.
The initial Phase 1 investment of $34 million will result in the occupancy of 102,000 square feet at The Commons at Rivulon, representing 1,500 new jobs at an average annual salary of just over $95,000. The development agreement between the Town of Gilbert and Deloitte also plans for two additional phases of expansion.
Each additional phase represents an estimated 500 new jobs; 50,000 square-feet; and $10,245,000 in capital expenditures. In total, the three phases represent 2,500 jobs; 202,000 square feet; and $54,490,000 in capital expenditures.
Deloitte conducted a national search for its newest U.S. Delivery Center, which will be focused on developing and implementing emerging technology solutions for a range of private and public sector clients.
Deloitte will seek a range of information technology driven professionals with diverse backgrounds and skillsets, including knowledge of salesforce, SAP, software development and analytics. The state-of-the-art center will serve state government clients in the west region and commercial clients in industries including health care and financial services.
Attracting significant investment from a global company, and assisting in the expansion of their operations within the community, supports economic development initiatives and enhances Gilbert’s reputation as a desirable community for investment from technology based industries. Companies in Gilbert can reach a workforce of nearly one million people within a 30-minute commute, which makes this project a big win for the entire Greater Phoenix area.
Ignite Fredericton (Canada) for the Cyber Park
Rising cybercrime has increased the demand for cybersecurity skills in the global market and construct of a new fast-growing industry. With the number of cybersecurity jobs available globally projected to rise to 2 million by 2019, Fredericton, over the past decades, has evolved to fill the gap through a multi-stream approach that encompasses both the knowledge and infrastructure required to attract talent placing the region in an international leadership position for cybersecurity. With the Canadian Institute for Cybersecurity (CIC) and IBM’s headquarters for cybersecurity research and development already being housed in the city, many organizations, ranging from the world’s tech giants to startups in the cybersecurity sector, have chosen Fredericton to be the place to start, grow and locate.
In order to support this burgeoning sector, Fredericton established a long-term economic development strategy that involved an expansion of Knowledge Park, Atlantic Canada’s largest technology and research park, called Cyber Park.
The 135,000-square-foot Cyber Park is dedicated to accelerating Fredericton’s fast-growing cybersecurity sector. This project is being executed in collaboration with the federal, provincial and municipal governments, the University of New Brunswick, Ignite Fredericton, Planet Hatch and the regional development corporations, Opportunities NB and CyberNB.
Fredericton has a long-standing reputation of being the knowledge capital of Atlantic Canada. The region is the heart of Atlantic Canada’s information technology and research and development sector. The city also has over two decades of investment in digital infrastructure and skills-training that have resulted in a city-wide ecosystem that produces cutting-edge innovations deployed around the world. Consequently, Fredericton has positioned itself on the leading edge of global cybersecurity innovation presenting the most conducive location to house this project.
Cyber Park will not only be the critical component that brings together all of the region’s initiatives around cybersecurity, but the center also will be supporting regional and national economic development priorities to attract new talent and business to the region. The first phase of the project is predicted to attract over 20 cybersecurity companies to the region creating over 800 direct high-skilled jobs, 9.8 million in consumer spending in the Fredericton region and $140 million of GDP impact on an annual basis. This $37-million building will be located on the north side of Knowledge Park Drive, approximately 500 meters from the existing Knowledge Park buildings. This location provides the best long-term plan for future cybersecurity growth.
However, the two towers are just the starting point. In the second phase of the economic development strategy, Knowledge Park plans to establish an additional four to eight buildings, adding another 500,000 square feet and 3,500 to 5,000 jobs in a five to ten year period that will result in over $5 million in GDP impact.
The Irving (TX) Economic Development Partnership for Pei Wei Asian Diner Corporate Headquarters
Pei Wei is a fast-casual restaurant concept that specializes in hand-crafted Asian cuisine, with 225 restaurants in 30 states and total international sales annually of $350 million.
When Pei Wei Asian Diner made the decision to separate from its parent company, P.F. Chang’s China Bistro headquarters in Scottsdale, AZ, a move to Irving, TX was part of the plan to create its own brand identity. Pei Wei chose to relocate to the market where it has the biggest presence with 28 units, giving North Texas the highest concentration of concept units.
Pei Wei currently has 6,300 employees in the U.S. in its restaurant operations and 50 in its corporate headquarters with plans to hire approximately 100 employees over the next five years for its corporate office and test kitchen. The average annual compensation for the initial jobs is $125,000.
Pei Wei will invest $1.5 million in 12,000 square feet of existing building for offices, meeting space and the test kitchen over a four year period, including $1 million for buildings and other real property improvements and $500,000 in machinery and equipment.
The City of Irving granted a $750 per job grant for new hires, up to 100 jobs. In addition, the Irving Economic Development Partnership is coordinating in-kind assistance from business/executive clubs and participation in the City’s Business Development Incentive Program (BizDIP).
PICKING THE WINNER
2018 Economic Deal Of The Year Judges
- Philip Anderson, PhD, President and CEO, P.W. Anderson & Partners
- Glenn Mair, Director, MMK Consulting
- David Hickey, Senior Managing Director, Hickey & Associates
- Jerry Szatan, Founder and Principal, Szatan & Associates
- Howard Silverman, President & CEO, CAI Global Group Inc.
The 2018 Economic Development Deal of the Year recognizes the locations and economic development agencies that landed the highest-impact projects announced between July 1, 2017 and the entry deadline of December 1, 2018.
For the purposes of this award, an “economic development deal” is defined as:
- A project or effort that resulted in the relocation/expansion of a company to a location served by the entering organization;
- A project resulting in the expansion of a company already within the territory served by the entering organization;
- A project or effort that resulted in the demonstrable retention of a company that would have otherwise left, in whole or in part, the territory served by the entering organization;
- Any combination of the above.
Nominees were required to provide official economic impact numbers produced by the RIMS II, IMPLAN or REMI certified analysis methods, including direct, indirect and induced figures for economic output, job creation and capital investment when available, as well as anticipated new wages; and a narrative explaining how the deal came together, including details on regional cooperation, innovative incentives and training programs in partnership with higher education resources, where applicable.
Judges evaluated the narrative and the economic impact numbers and gave each project a score ranging from zero to 100. The highest-rated entry is our Gold winner and is considered our official Economic Development Deal of the Year; the second, third and fourth place entries win the Silver, Bronze and Honorable Mention awards, respectively. The awards were announced on our website in January.